Fidelity launches special situations fund

By Staff
|
Google Oneindia News

New Delhi, Mar 30 (UNI) Fidelity, world's largest mutual fund, has launched a new category of funds in India which will invest only in companies that find themselves in ''special business situations''.

The fund house has defined special situations as companies with hidden value in associated businesses or companies that are potentially on some big M&A list or even corporates who have plans to unlock value through de-mergers.

Fund Manager for Fidelity Special Situations Fund, Rajiv Singh, said, ''These are the stocks that are out of favour, restructuring stories, maybe some asset plays, new businesses, also growth stories which are underappreciated.'' Fidelity India Special Situations Fund is an open-ended equity fund that aims to deliver long-term growth by investing across the spectrum of Indian equities with a focus on companies in special situations.

Fidelity Fund Management Private Ltd Country Head Ashu Suyash described this as a more aggressive fund that will strive to add higher alpha to the portfolio over the long-term through bottom up stock picking. ''As such, should be an interesting style diversifier for investors,'' she said.

Fidelity already runs a Special Situations Fund in the UK which manages assets worth 6 billion pounds. This apart it also runs similar funds in America, Japan and Asia.

The minimum amount for lump sum investments is Rs 5,000 and multiples of Rs 1,000. The entry load has been fixed at 2.25 per cent for each purchase of less than Rs 5 crore.

For amounts greater than or equal to Rs 5 crore or by an FOF or on dividend reinvestment, the entry load is zero. There is an exit load of 1 per cent for redemptions within the first six months for non-Systematic Investment Plan (SIP) investments.

The SIP option will be available during the NFO period with minimum 6 installments and each single installment for minimum of Rs 500 totalling not less than Rs 5000.

There will be an entry load of 1.25 per cent for each purchase less than Rs 1 lakh and an exit load of 1 per cent for redemptions within two years for investments made through SIP.

Fidelity has a basket of 40-60 stocks lined up for this Special Situations Fund.

The Fidelity Special Situations Fund's NFO will be open from March 28 to April 26, 2006.

With already three funds in the Indian market, Fidelity manages assets worth Rs 3,500 crore in the country and has an investor base of 4.75 lakh.

UNI SR SS BD1440

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